2UE Radio

16 Jan 2017 Transcipt

E&OE TRANSCRIPT
Interview with David Prior and Matthew Tukaki, Second Career on 2UE
16 January 2017

SUBJECTS: Jobs and opportunities in the Defence industry.



MATTHEW TUKAKI: 2017 is shaping up to be a massive year when it comes to jobs and opportunities and when you look at industries where there will be action you can’t go past the Defence sector. The Defence budget up until 2026 or 2025/26 is more than $58 billion and when you unpack that figure we as a nation will be investing a lot in new stock from ships and machines to technology and equipment. And you know, David, I love a few tanks.

DAVID PRIOR: Yes. Well we could add them to the list.

MATTHEW TUKAKI: We could add anything really. When you think of this …

DAVID PRIOR: [Indistinct] Why not?

MATTHEW TUKAKI: Why not? And where we’re making those investments comes jobs and opportunities. Now we’re joined by a great fella, Christopher Pyne, Federal Minister for Defence Industries, on the show to talk about why this spend is so important for Australia’s economy and our Defence.

Minister, welcome to the show.

CHRISTOPHER PYNE: Thank you very much for having me. It’s good to be with you.

MATTHEW TUKAKI: Not a problem. So 2017, if you believe some of the pundits out there, it’s not shaping up to be a great year and people are concerned about the economy, but here’s an example of an industry where there’s a huge amount of opportunity, right?

CHRISTOPHER PYNE: Absolutely and we are seeing already a real buzz in the Defence industry. Right across Australia they’re reporting, the various industry groups, that they’ve never had so much interest from small and medium enterprises to large businesses. Their conferences are overflowing, their workshops are overflowing with people wanting to come, there are people applying for jobs.

This will give you one example: Saab in South Australia two years ago asked for five graduates, got 10 applications; last year they asked for 10 graduate positions, got 240.

MATTHEW TUKAKI: Wow.

CHRISTOPHER PYNE: So people are seeing enormous potential in Defence industry. In your introduction you talked about the Defence budget rising to $58 billion a year, over the next 10 years we’re spending $195 billion more on Defence capability. And the difference between this Government’s attitude and previous governments is that we want as much of that as possible spent in Australia, which means jobs and investment.

MATTHEW TUKAKI: Well in truth, you’ve also made decisions, right? And some of those decisions have been too long in the tooth.

CHRISTOPHER PYNE: Absolutely. We are making decisions that will get the machinery of Defence industry, if you like, moving. So we’ve decided to build 12 offshore patrol vessels and we’ve already released the request for tender. We’re building nine future frigates, they’ll start in 2020. And the submarines, 12 of those will start in 2022/23. That’s just in naval ship building; that’s about $90 billion. But we’re also upgrading every single Defence base in Australia; our rocket testing range at Woomera. We’re investing in things like the combat reconnaissance vehicles; 225 costing $5 billion, but rather than simply buying them from BAE or Rheinmetall in Britain or Germany we’re requiring that they get built here. So we are not just spending the money, we’re making sure that those kinds of jobs for the future – which are high-tech, high value advanced manufacturing jobs – are here in Australia.

MATTHEW TUKAKI: And it comes at a time where we are going through a bit of a transition. I mean we all know what’s going on with the car manufacturing industries in places like Victoria and South Australia. I mean, near enough, we’re talking about skills in those industries that can be transitioned into new Defence industries, right?

CHRISTOPHER PYNE: Well many of them can be. And just to put it in perspective, there are 1200 or so people at Holden who will be losing their jobs over the next few months, there are 5000 jobs to be created in naval ship building in South Australia alone through the offshore patrol vessels, future frigates and submarine projects. So rather than being down in the mouth and disheartened about negative stories, this is a totally positive story because these jobs, as you point out, are in manufacturing, are easily transferable between industries because they are engineering, they are electricians, they are welders, they’re tradesmen, they are also mathematicians and scientists and researchers. They’re high value added jobs. Now we can’t compete with Bangladesh to make t-shirts, but we can sure as Hell compete with any country in the world to make armaments or heavy industry or manufacturing like shipbuilding or aircraft.

MATTHEW TUKAKI: Now, David, listen to what Christopher’s talking about really. We’re talking about jobs are the future, they’re being created right now. And we’re also, Minister aren’t we, we’re talking about jobs not only direct employment you know where people are going to be employed by these big builders et cetera, et cetera, we’re talking about supply chain opportunities for smaller business right?

DAVID PRIOR: This is right around Australia isn’t it?

CHRISTOPHER PYNE: Absolutely right around Australia. So there are very significant Defence assets and businesses in Brisbane, particularly in western Brisbane; in western Sydney; in Melbourne; and in Geelong of course; in Bendigo; Ballarat; in north western Tasmania; of course, in northern Adelaide; and in Osborne, where the shipbuilding goes on; of course, out in Western Australia in Henderson, which is south Perth. There is significant Defence industry right across our country. I mean, let’s just take the Joint Strike Fighter program. Already Australian businesses have earned $800 million from the Joint Strike Fighter program, not by just being subcontractors, but actually providing the parts for every single Joint Strike Fighter being built in the world right now. So a business called Marand, for example, in Melbourne is making all the vertical tail fins for every Joint Strike Fighter in the world. We’ve just run the right to be the maintenance and sustainment hub for engines and frames and componentry of the Joint Strike Fighters, that will be based in northern New South Wales and in western Queensl- western Brisbane. All of that is worth literally hundreds of millions, if not billions of dollars over the next coming decade. So there are 32 businesses alone sharing in that contract on its own, earning at least $800 million just to start with. So this is a national endeavour.

MATTHEW TUKAKI: And it’s also …

DAVID PRIOR: [Talks over] … and then there’s a flow on effect, yeah.

MATTHEW TUKAKI: Here’s another example that not a huge number of our listeners will be aware of, but the 787 Dreamliner that’s being built and manufactured by Boeing. Now some of the parts of that plane, the carbon fibre technology has been designed, developed and manufactured in Melbourne.

DAVID PRIOR: [Talks over] It’s incredible isn’t it? The opportunities are there.

MATTHEW TUKAKI: Well that’s right, I mean you started with Defence industries, David, and the flow on impact through supply chain in to other sectors, outside of just Defence, can be hugely valuable. Now, Minister, we can’t let you go from the show without putting a proposition to you, are you ready?

CHRISTOPHER PYNE: I suppose I’m as ready as I can be.

MATTHEW TUKAKI: [Laughs] We love this. Space ports, you know [laughs], we think that possibly there could be an opportunity for a space port somewhere in Australia.

DAVID PRIOR: Outback.

MATTHEW TUKAKI: Outback somewhere.

CHRISTOPHER PYNE: Well there is a very big space conference happening this year in Adelaide in the end of 2017. It is the largest space conference in the world; it was won by Adelaide, the right to host it. There will be 4000 to 5000 delegates from right across the world. We used to have quite an important space industry based in Woomera in the 1950s and 60s. Goodness knows why we decided not to pursue it, but we did. And we need to bring back as much of that kind of very high technology, advanced research and science that the space industry brings

MATTHEW TUKAKI: We’re just thinking of the future here. We’re looking to …

CHRISTOPHER PYNE: Well absolutely, and so you should be and I bet you that there will be a space port in Australia at some point in our lifetimes because there are so many people in Australia who want to get in to the areas of satellites and space and we have the skills and the intellectual capability. And this is where- we bemoan so many things in Australia. We talk about traditional manufacturing closing down, our labour costs are such that we can’t compete with lots of developing countries in terms of old fashioned manufacturing, but when it comes to space and satellites and Defence and aircraft and ships, of course we can compete because the labour costs are less important because they are high value advanced manufacturing jobs. But we do have the intellectual capability and the skills base already to capitalise on that kind of investment.

MATTHEW TUKAKI: Well we also, actually to be honest, the idea came to us when we were interviewing Andy Thomas, only a few weeks back and we were talking …

CHRISTOPHER PYNE: [Interrupts] He is a very proud South Australian.

DAVID PRIOR: You bet he is.

MATTHEW TUKAKI: Well it’s a South Australian day today. We’ve had the University of South Australia on … Yeah what’s going on?

CHRISTOPHER PYNE: It’s blossoming, it’s like a renaissance.

DAVID PRIOR: It’s nice to see.

MATTHEW TUKAKI: [Laughs] It’s beautiful to see. But the idea from Andy, who’s involved in next generation jet propulsion design and development for NASA, and you know, I do lament we’ve got a great Australian out there doing these sorts of things, wouldn’t it be great for that great Australian to lead an initiative here in Australia? I don’t know we’ll wait and see what time brings.

But hey, look, Christopher Pyne, Federal Minister for Defence Industries, thank you so much for joining us on 2UE Talking Lifestyle today.

CHRISTOPHER PYNE: It’s a great pleasure, thanks for having me.